Paddy Power Betfair Q3 online revenues slide 3% on sportsbook decline
Sports betting revenues fall 3% year-on-year as operator confirms Peter Jackson will take up CEO role on 8 January
Paddy Power Betfair (PPB) this morning announced a 3% year-on-year decrease in Q3 online revenues following a fall in sportsbook revenues and a flat-lining gaming business.
The Group recorded digital revenues of £216m for the three-month period to 30 September 2017, down from £222m in the comparative period in 2016, with sportsbook revenue sliding 3% to £156m.
The decline in revenues from the operator’s sports betting business came despite a 10% year-on-year rise in stakes as favourable sports results contributed to 0.8 percentage point margin decrease.
Exchange revenue was also down 5% year-on-year, although PPB said this was in line with expectations due to a “tough” comparable period in 2016.
Meanwhile, the company’s gaming business continued to struggle as revenues flat-lined to £60m following a 3% year-on-year fall in H1.
PPB’s Australia-facing business was the standout performer as revenues increased 29% in constant currency, with a 33% uptick in stakes, which it attributed to “product investment and promotional generosity”.
Corcoran added: “Our international businesses performed particularly well. In Australia, the winning combination of innovative product and marketing excellence continued to deliver exceptional results, with revenue up 29%, while US revenue was up 18%”
The operator today also confirmed its new chief executive Peter Jackson, whose appointment was announced in August, will take over from outgoing CEO Breon Corcoran on 8 January.
Corcoran said: “In the New Year, I will hand over leadership of the Group to Peter Jackson and, while the industry remains highly competitive and is exposed to regulatory risks, I believe the business’ scale, leading capabilities and market positions mean it remains well placed to deliver sustainable, profitable growth.”
The firm also projected a turnaround in 2018, as its platform integration nears completion. The company said new Paddy Power desktop and mobile front ends are currently being tested with a small number of customers.
“We anticipate that all Paddy Power customers will be migrated to the integrated platform by early 2018,” the firm noted. “Completion of the integration will both improve efficiency and facilitates enhancement of our customer proposition.”
Group revenue was up 8%cc year-on-year to £440m, while underlying EBITDA increased 9%cc to £121m, as PPB’s retail business posted a 12% revenue rise.
Read PPB’s entry in this year’s Power 50 here